The Basic Law (Constitution) provides for religious freedom, and the Government generally respects this right in practice; however, discrimination against minority religious groups remains an issue.

There was no change in the status of respect for religious freedom during the period covered by this report, and government policy continued to contribute to the generally free practice of religion. The Government does not recognize Scientology as a religion, viewing it instead as an economic enterprise; federal and state classification of Scientology as a potential threat to democratic order has led to employment and commercial discrimination against Scientologists in both the public and private sectors. A federal court upheld states' right to ban the wearing of Muslim headscarves by teachers in public schools, and two states passed legislation in the period covered by this report to prohibit public school teachers from wearing Muslim headscarves.

The generally amicable relationships among religions in society contributed to religious freedom. Members of minority religions, including Scientologists, reported an improving climate of tolerance. However, senior government officials continued to refuse to enter into direct dialogue with the Church of Scientology. The Lutheran Church as well as the state governments of Bavaria, Baden-Wuerttemberg, and Hamburg continued their information campaign against Scientology and other alleged "cults." These actions contributed to persistent negative public attitudes toward members of minority religions.

The U.S. Government discusses religious freedom issues with the Government as part of its overall policy to promote human rights. The U.S. Government placed particular emphasis on support for direct dialogue between representatives of minority religions and relevant government officials.

The country has a total area of 137,847 square miles, and its population is approximately 82 million. There are no official statistics on religions; however, unofficial estimates and figures provided by the organizations themselves give an approximate breakdown of the membership of the country's denominations. The Evangelical Church, which includes the Lutheran, Uniate, and Reformed Protestant Churches, has 27 million members, who constitute 33 percent of the population. Statistical offices in the Evangelical Church estimate that 1.1 million members (4 percent of the membership) attend weekly religious services. The Catholic Church has a membership of 27.2 million, or 33.4 percent of the population. According to the Church's statistics, 4.8 million Catholics (17.5 percent of the membership) actively participate in weekly services. According to government estimates, there are approximately 3.1 to 3.5 million Muslims living in the country (approximately 3.4 percent to 3.9 percent of the population). Statistics on mosque attendance were not available.

Orthodox churches have approximately 1.1 million members, or 1.3 percent of the population. The Greek Orthodox Church is the largest, with approximately 450,000 members; the Romanian Orthodox Church has 300,000 members; and the Serbian Orthodox Church has 200,000 members. The Russian Orthodox Church, Moscow Patriarchate has 50,000 members, while the Russian Orthodox Church Abroad has approximately 28,000 members. The Syrian Orthodox Church has 37,000 members, and the Armenian Apostolic Orthodox Church has an estimated 35,000 members.

Other Christian churches have approximately 1 million members, or 1.2 percent of the population. These include Adventists with 35,000 members, the Apostolate of Jesus Christ with 18,000 members, the Apostolate of Judah with 2,800 members, the Apostolic Community with 8,000 members, Baptists with 87,000 members, the Christian Congregation with 12,000 members, the Church of Jesus Christ of Latter-day Saints (Mormons) with 39,000 members, the Evangelical Brotherhood with 7,200 members, Jehovah's Witnesses with 165,000 members, Mennonites with 6,500 members, Methodists with 66,000 members, the New Apostolic Church with 430,000 members, Old Catholics with 25,000 members, the Salvation Army with 2,000 members, Seventh-day Adventists with 53,000 members, the Union of Free Evangelical Churches with 30,500 members, the Union of Free Pentecostal Communities with 16,000 members, the Temple Society with 250 members, and the Quakers with 335 members.

Jewish congregations have approximately 87,500 members and make up 0.l percent of the population. According to press reports, the country's Jewish population is growing rapidly; more than 100,000 Jews from the former Soviet Union have come to the country since 1990, with smaller numbers arriving from other countries as well. Not all new arrivals join congregations, resulting in the discrepancy between population numbers and the number of congregation members.

The Unification Church has approximately 850 members; the Church of Scientology has 6,000 members; Hare Krishna has 5,000 members; the Johannish Church has 3,500 members; the International Grail Movement has 2,300 members; Ananda Marga has 3,000 members; and Sri Chinmoy has 300 members.

Approximately 21.8 million persons, or 26.6 percent of the population, either have no religious affiliation or belong to unrecorded religious organizations.

The Basic Law (Constitution) provides for freedom of religion, and the Government generally respects this right in practice; however, discrimination against minority religious groups remains an issue.

Religion and State are separate, although historically a special partnership exists between the State and those religious communities that have the status of a "corporation under public law." If they fulfill certain requirements, including assurance of permanence, size of the organization, and no indication that the organization is not loyal to the State, religious organizations may request that they be granted "public law corporation" status, which among other things entitles them to levy taxes on their members that the State collects. Organizations pay a fee to the Government for this service, and not all public law corporations avail themselves of this privilege. The decision to grant public law corporation status is made at the state level. Many religious groups have been granted public law corporation status. Among them are the Lutheran and Catholic Churches, as well as the Jewish community, Mormons, Seventh-day Adventists, Mennonites, Baptists, Methodists, Christian Scientists, and the Salvation Army.

The State provides subsidies to some religious organizations for historical and cultural reasons. Some Jewish synagogues have been built with state financial assistance because of the State's role in the destruction of synagogues in 1938 and throughout the Nazi period. Repairs to and restoration of some Christian churches and monasteries are undertaken with state financial support because of the expropriation by the State of church lands in 1803 during the Napoleonic period. Having taken from the churches the means by which they earned money to repair their buildings, the State recognized an obligation to cover the cost of those repairs. Subsidies are paid out only to those buildings affected by the 1803 Napoleonic reforms. Newer buildings do not receive subsidies for maintenance. State governments also subsidize various institutions affiliated with public law corporations, such as religious schools and hospitals.

According to the "State Agreement on Cooperation" signed by the Government and the Central Council of Jews, approximately $3,396,300 (3 million euros) will be provided annually to the Central Council of Jews, which in turn will provide the Government with an annual report on the use of the funds. The agreement emphasizes that the Central Council of Jews is open to all branches of Judaism. Since the agreement was ratified, a conflict has developed between the Central Council, which is Orthodox in orientation, and the World Union for Progressive Judaism, because the Central Council refused to disburse funds to any institutions other than Orthodox Jewish institutions. Political leaders, including Chancellor Gerhard Schroeder and Interior Minister Otto Schily, used their offices to mediate this ongoing dispute.

Religious organizations are not required to register. Most religious organizations are registered and treated as nonprofit associations, which enjoy tax-exempt status. State-level authorities review registration submissions and routinely grant tax-exempt status. Organizations must register at a local or municipal court and provide evidence, through their own statutes, that they are a religion and thus contribute socially, spiritually, or materially to society. Local tax offices occasionally conduct reviews of tax-exempt status. On January 27, 2003, the Federal Office for Finances granted the Church of Scientology an exemption from taxes on license fees paid to U.S.-based Church of Scientology organizations for copyrighted materials, based on a decision by the Cologne Court issued on October 2002; the court based its decision on the double‑taxation agreement between the Government and the U.S.

Most public schools offer religious instruction in cooperation with the Protestant and Catholic churches and offer instruction in Judaism if enough students express interest. A nonreligious ethics course or study hall generally is available for students not wishing to participate in religious instruction. The issue of Islamic education in public schools has become topical in several states. In 2000 the Federal Administrative Court upheld previous court rulings that the Berlin Islamic Federation qualified as a religious community and as a result must be given the opportunity to provide religious instruction in Berlin schools. The decision drew criticism from the many Islamic organizations not represented by the Berlin Islamic Federation, and the Berlin State Government expressed its concerns about the Islamic Federation's alleged links to Milli Gorus, a Turkish group classified as extremist by the Federal Office for the Protection of the Constitution (OPC). However, after another court decision in favor of the Islamic Federation in 2001, Berlin school authorities decided to allow the Islamic Federation to begin teaching Islamic religious classes in several Berlin schools starting in September 2001. The classes have subsequently caused little controversy. Bavaria announced in 2000 that it intended to offer German-language Islamic education in its public schools starting in 2003. In the beginning of the 2003-2004 school year, they began a trial phase of Islamic education at a public school in Erlangen. State-wide Islamic education is not possible, as the Education Ministry has no legitimate partner representing Muslims in Bavaria with which it can deal. Bavaria, in cooperation with Turkey, has offered "Islamic religious instruction" in its public schools since the eighties, and since 2001, this subject has been offered in both Turkish and German.

The Berlin Buddhist Society offered Buddhist religious education in public schools. Under Berlin's public education system, 90 percent of the cost of approved religious education, as well as provision of facilities, is publicly funded.

The right to provide religious chaplaincies in the military, in hospitals, and in prisons is not dependent on the public law corporation status of a religious community. The Ministry of Defense was considering the possibility of Islamic clergymen providing religious services in the military, although none of the many Islamic communities has the status of a corporation under public law.

Government policy continued to contribute to the generally free practice of religion.

The Federal Interior Ministry continued its immigration exclusion (refusal to issue a visitor visa) against the founder of the Unification Church, Reverend Sun Myung Moon, and his wife, Hak Ja Har Moon. The couple have been refused entry to the country (and through Schengen Treaty visa ineligibility, to other Schengen countries as well) since 1995, when the Chief Office for Border Security issued a notice of refusal of entry for an initial period of 3 years. The Government refused entry based on its characterization of Reverend Moon and his wife as leaders of a "cult" that endangers the personal and social development of young persons. Citing this original justification, the Government extended its refusal of entry for another 2 years in August 2002 and was the only Schengen country to do so. The Unification Church asserts that Reverend and Mrs. Moon's personal presence at certain ceremonies is a crucial part of the Church's doctrine and has sought legal remedies to the refusal of entry. However, federal courts have ruled that the exclusion does not infringe upon church members' freedom to practice their religion.

The Higher Federal Administrative Court had not yet decided an appeal by members of Jehovah's Witnesses to overturn the Berlin State Government's decision to deny them public law corporation status. A Federal Administrative Court in Berlin concluded that the group did not offer the "indispensable loyalty" toward the democratic state "essential for lasting cooperation" because it forbade its members from participating in public elections. The group does enjoy the basic tax-exempt status afforded to most religious organizations.

The Church of Scientology, which operates 18 churches and missions, remained under scrutiny by both federal and state officials, who contend that its ideology is opposed to the democratic constitutional order. Since 1997 Scientology has been under observation by the federal and state OPCs. In observing an organization, OPC officials seek to collect information, mostly from written materials and firsthand accounts, to assess whether a "threat" exists. More intrusive methods would be subject to legal checks and would require evidence of involvement in treasonous or terrorist activity. Federal OPC authorities stated that no requests had been made to employ more intrusive methods, nor were any such requests expected.

Within the federal system, the states showed large differences with respect to their treatment of the Church of Scientology. Two states, Schleswig-Holstein and Mecklenburg-Vorpommern, did not monitor Scientology, stating that Scientology does not have an actively aggressive attitude toward the Constitution, the condition required by the states' laws to permit OPC observation. The city-state of Berlin dropped OPC observation of Scientology in September 2003, and the states of Hesse and North Rhine-Westphalia did not mention Scientology in their 2003 OPC reports. However, Bavaria announced in November 2002 that it may seek to ban Scientology based on recommendations of a report and indicated that it would ask the Federal Interior Ministry to consider a federal ban. Bavaria has cited medical malpractice associated with Scientology's "auditing" techniques as one possible basis for the ban. At a convention of state interior ministers in March 2003, Bavaria found no support among other states, except for Hamburg and Baden-Wuerttemberg, for the idea of a ban against Scientology.

Other organizations under OPC observation are right-wing extremist, left-wing extremist, or foreign extremist and terrorist groups; Scientology is the only religious community under OPC observation, and Scientologists contend that inclusion in the list of totalitarian and terrorist groups is harmful to the Church's reputation. The federal OPC's annual report for 2002 concluded that the original reasons for initiating observation of Scientology in 1997 remained valid but noted that Scientology had not been involved in any criminal activity.

During the period covered by this report, a state university in Saxony threatened one of its prominent German university professors with termination if he did not desist from publicly condemning official government discrimination against Scientology. The professor, who is not a Scientologist himself, has been the subject of intense personal criticism by Saxon government officials and by academic colleagues.

Several states have published pamphlets detailing the ideology and practices of minority religions. States defend the practice by noting their responsibility to respond to citizens' requests for information about these groups. While many of the pamphlets are factual and relatively unbiased, some groups fear that inclusion in a report covering known dangerous cults or movements could harm their reputations. Scientology is the focus of many such pamphlets, some of which warn of alleged dangers posed by Scientology to the political order and free market economic system and to the mental and financial well being of individuals. The Hamburg OPC published "The Intelligence Service of the Scientology Organization," which outlines its claim that Scientology tried to infiltrate governments, offices, and companies and that the Church spies on its opponents, defames them, and "destroys" them.

Since March 2001, the Government has prohibited firms bidding on government contracts from using the "technology of L. Ron Hubbard" in executing government contracts. Firms owned, managed by, or employing Scientologists could bid on these contracts. The private sector on occasion required foreign firms that wished to do business in the country to declare any affiliation that they or their employees may have with Scientology. Private sector firms that screen for Scientology affiliations frequently cited OPC observation of Scientology as a justification for discrimination. The Federal Property Office barred the sale of some real estate to Scientologists, noting that the Finance Ministry had urged that such sales be avoided if possible.

Since 1996 employment offices throughout the country have implemented an Economics and Labor Ministry administrative order directing them to enter an "S" notation next to the names of firms suspected of employing Scientologists. Employment counselors are supposed to warn their clients that they might encounter Scientologists in these workplaces. Scientologists have claimed that the "S" notations violate their right to privacy and interfere with their livelihood.

Scientologists continued to report instances of societal discrimination. For example, Bavaria required applicants for state civil service positions to complete questionnaires detailing any relationship they may have with Scientology. Currently employed civil servants were not required to provide this information. The questionnaire specifically stated that the failure to complete the form would result in the employment application not being considered. However, previous court cases have ruled in favor of employees who have refused. According to Bavarian and federal officials, no one in Bavaria lost a job or was denied employment solely because of association with Scientology; Scientology officials confirmed this. A number of state and local offices shared information on individuals known to be Scientologists. There were numerous reports from Scientologists that they were denied banking services when the account was to be opened under the name of the Church of Scientology, and they were denied the right to rent facilities to hold meetings and seminars.

A July 2002 ruling by the Federal Constitutional Court clarified the Government's "warning" function with respect to nontraditional religions. In a case pending since the 1980s involving the "Bagwan/Osho Spiritual Movement," the Court ruled that the Government is allowed to characterize such nontraditional religions as "sects," "youth religions," and "youth sects" and is allowed to provide accurate information about them to the public; however, the Government is not allowed to defame them by using terms such as "destructive," "pseudo‑religion," or "manipulative."

In October 2003, the Federal Constitutional Court overturned a lower court's 2002 decision that without the appropriate state legislation, a school in Baden-Wuerttemberg could prohibit a Muslim teacher from wearing a headscarf to work. The ruling does not affect states' ability to establish a legal basis for banning headscarves in schools. After the ruling, several states indicated their intention to enact laws prohibiting Muslim public servants from wearing headscarves on duty. Several states have submitted draft laws prohibiting Muslim teachers from wearing headscarves on duty in public schools. During the period covered by this report, the states of Bavaria and Baden‑Wuerttemberg have formally enacted such legislation.

Difficulties sometimes arise between religious groups and the State over tax matters and zoning approval for building places of worship. The state government has repeatedly denied an Islamic organization in Berlin approval to build an Islamic cultural center due to the government's allegation that the organization has ties to the "Muslim Brotherhood" extremist organization. The organization disputes this allegation and insists that it rejects all forms of extremism.

There were no reports of forced religious conversion, including of minor U.S. citizens who had been abducted or illegally removed from the United States, or of the refusal to allow such citizens to be returned to the United States.

The generally amicable relationship among religions in society continued to contribute to religious freedom.

The country is becoming increasingly secular. Regular attendance at religious services is decreasing. After more than 4 decades of Communist rule, the eastern part of the country had become far more secular than the western part. Representatives of religious groups note that only 5 to 10 percent of eastern inhabitants belong to a religious organization.

Following a rise in the incidence of anti-Semitic crimes and an increase in public criticism of the Israeli Government's actions in the Middle East, Jewish community leaders expressed continuing concern about their perception of a rise in anti‑Semitism in the country. In addition, several Jewish groups accused the print media of pro-Palestinian bias in their reporting of the situation in the Middle East and expressed concern that this alleged bias could increase anti-Semitic attitudes. In October, the public remarks of Martin Hohmann, a Christian Democratic Union (CDU) member of Parliament, comparing the actions of Jewish persons during the Russian Revolution to those of the Nazis during the Holocaust, led to the opening of an inquiry following a criminal complaint alleging incitement and slander. The CDU subsequently expelled Hohmann from its parliamentary caucus. During the period covered by this report, Jewish cemeteries were desecrated in Kassel and Beeskow. Dozens of gravestones were pushed over or painted with pro-Nazi graffiti. In September, police arrested several persons for suspected involvement in a plot to bomb Munich's Jewish Center. In early May, the Prosecutor started proceedings against four neo-Nazis from "Kameradschaft Sued" who had planned the bomb attack. The initial indictment reads "membership in a terrorist organization," and the Prosecutor indicated that a second indictment against the head of the group, Martin Wiese and his deputy would follow later in 2004. Recent anti-Semitic incidents indicate that Arab youths are increasingly behind attacks on and harassment of the country's Jewish persons. Authorities strongly condemned the attacks and devoted significant investigative resources to the cases. A synagogue in Duesseldorf that was burned in 2001 remained under around‑the-clock police protection.

In April, the Government hosted a historic Organization for Security and Cooperation (OSCE) conference on anti-Semitism. With strong support from the Government, the OSCE conference led to a declaration calling on OSCE member states to implement a set of concrete measures to combat anti-Semitism.

Authorities run a variety of tolerance-education programs, many focusing on anti-Semitism and xenophobia. The programs receive input and assistance from Jewish nongovernmental organizations.

With an estimated 3 million adherents, Islam is the third most commonly practiced religion in the country after Catholicism and Lutheranism. All branches of Islam are represented, with the vast majority of Muslims coming from other countries. At times this has led to societal discord, such as local resistance to the construction of mosques or disagreements over whether Muslims may use loudspeakers in residential neighborhoods to call the faithful to prayer. There also remain areas where the law conflicts with Islamic practices or raises religious freedom issues. On September 3, 2003, a Neo-nazi from Brandenburg was sentenced to 6 years in jail after having thrown Molotov cocktails against a Turkish snack bar; six persons were inside at the time. Reports continued of opposition to the construction of mosques in various communities around the country. The opposition generally centered on issues such as concern about increased traffic and noise that would result from new construction.

The Lutheran Church employs "sect commissioners" to investigate "sects, cults, and psycho-groups" and to publicize what they consider to be the dangers of these groups to the public. The Lutheran sect commissioners are especially active in their efforts to warn the public about supposed dangers posed by Scientology, as well as the Unification Church, Bhagwan-Osho, and Transcendental Meditation. The printed and Internet literature of the sect commissioners portrays these as "totalitarian," "pseudo-religious," and "fraudulent." Mormons, Jehovah's Witnesses, the Church of Christ, Christian Scientists, the New Apostolic Church, and the Johannish Church are characterized in less negative terms but nevertheless are singled out as "sects."The Catholic Church also employs sect commissioners, who generally restrict their activities to providing counsel to individuals who have questions about "sects."

In the 1990s, three of the country'smajor political parties--the Christian Democratic Union and its Bavarian sister party the Christian Social Union (CDU/CSU), the Social Democratic Party (SPD), and the Free Democratic Party (FDP)--banned Scientologists from party membership. These bans, which have been challenged unsuccessfully in courts by excluded Scientologists, were still in effect at the end of the period covered by this report.

The U.S. Government discusses religious freedom with the Government as part of its overall policy to promote human rights.

In response to anti-Semitic crimes, members of the U.S. Embassy closely followed the Government's responses and officially expressed the U.S. Government's opposition to anti-Semitism. Mission officers maintained contacts with Jewish groups and continue to monitor closely the incidence of anti-Semitic activity.

The status of Scientology was the subject of many discussions during the period covered by this report. The U.S. Government expressed its concerns over infringement of individual rights because of religious affiliation and over the potential for discrimination in international trade posed by the screening of foreign firms for possible Scientology affiliation. Embassy officers at all levels consistently and repeatedly supported German Church of Scientology requests for direct dialogue with German Government officials. The U.S. Government consistently maintained that only an organization itself can determine whether it is religious.